In my area, there is software that hooks you up to the tax rolls - and that show every lien placed on a property. The MLS does this too, but for some reason the info is not as good. As a realtor, I have access to the MLS, and can do a search on a daily basis for all the new liens placed on homes. I have found that a large percentage of these properties are over-leveraged (they owe the same or close to the same amount as the house is worth). However, there are some people with good equity. Since it takes months for a foreclosure sale to actually take place, it seems it would be worth “monitoring” and contacting these people, and as “the sale day” gets closer, they may become more motivated to talk to you. I would think that if you contact someone on the phone the same day the bank delivers the information that their house is being foreclosed on (even though they are most probably expecting it), you will get an angry, upset person who will consider you a vulture, accuse you of invading their privacy, and tell you to get lost - but a non-threatening “let me help you save your home and/or credit” letter may be seen as a godsend. I’ve not tried this yet, but have some ideas in the back of my head on how to do this once I have some more funds to do the deals myself. These people may even be good candidates for Lease-Options on their own property - if theirs is a short-term problem (and if they have equity and a good payment history, chances are they just had a major life trauma, and would be grateful for the chance to get back on track - just don’t know how to do it)
Posted by Tim (Atlanta) on March 01, 1999 at 06:35:39:
I have has somewhat better luck with REOs. I have only bought one property from HUD ($70,000 appraised value, bought for $37,500 added in $5,000 for repairs). Recently I bought an REO from Fannie Mae. I had no idea it was a Fannie Mae until I saw the listing. I keep a close watch on the neighborhoods that I buy in. Anyway, I bought a fully renovated property for $38,500 and it appraised for $65,000. Last week I put one other REO under contract at $35,000. It will probably appraise at $55,000. The deals are out there, they are very few and far between. But you have to remember, that is the business we are in. Any good real estate investor will only buy about 5% of the properties that are currently for sale. The trick is finding the good deals.
I have to agree with George about bank REO’s. The resell in our area is still fairly strong where the buyer can purchase at 90-100%FMV. We as TRUE investtors have to purchase below such to be in a position of either cash flow or resell w/ profit.
Try these sites anyway www.hud.gov
I have to agree with George about bank REO’s. The resell in our area is still fairly strong where the buyer can purchase at 90-100%FMV. We as TRUE investtors have to purchase below such to be in a position of either cash flow or resell w/ profit.
Try these sites anyway www.hud.gov
Posted by George on February 28, 1999 at 21:41:28:
Let’s see…what would make it a good site? Easy to find, complete instructions, lot’s of good deals, well publicized. Then thousands of people would visit it daily and bid the properties up to 120% of retail.
I’m not making fun of you, I’ve just had ZERO luck with reo’s. I think the good deals are destined for a buyer even before the bank actually takes it back. I sent my “I buy houses” letter to an owner that I knew was having problems and three months later, I see a for sale (by owner) sign in the window. I knock on the door and the house is already vacant, there’s a lockbox on it. It never made the foreclosure notices in the paper. It was apparently taken back (probably deed in lieu of foreclosure) by Dime Savings. Unfortunately, I can’t find out which one. Anybody know how I can find out? Also, does anybody know why HUD foreclosures are always given to out of area realtors and they make a big deal out of open houses and advertising at 60% fmv and then take bids. If they just listed the property with a local realtor, they’d get rid of it twice as fast.
I also called Citibank for a property they own and their automated answering system directed my to their website for REOs. Once I got there, I spent 10 minutes clicking around trying to find the info. No luck. You think they really want to sell the property?
Tim
Congratulations, but the question in this post was regarding web sites for REO’s. Have you had good fortune contracting REO’s directly with the lender or are you dealing with the local listing realtor? In my market it seems ALL REO’s are listed. I have had absolutely no success is going directly to the foreclosing bank. How about you?
Thanks
Posted by Tim (Atlanta) on March 01, 1999 at 11:45:42:
I was essentially replying to what the previous posters had said about there being no deals on REOs.
And like you, I have had NO success trying to get the properties before they are listed. In my area, the market is so hot, that the bankers will not give the investor a chance at the properties before they are listed. I know that the realtor gets a commission, thereby costing me more in the purchase price, but if I get in at the price I want, who cares if the realtor makes a commission? Most of the properties I buy have been on the market for 6 months or more, and the realtor has earned a commission by then. You understand, I am not strictly an REO buyer. I buy properties in areas and neighborhoods that I know very well. If these are REOs, that just means I most likely have a motivated seller.
All,
I too have had BAD luck trying to find decent REO’s that are not listed. The banks and other lenders in my area are not cooperative at all. We thought we had a good line on REO’s thru the bank that employs my wife, but then they “changed thier mind” and will only tell us about properties that have yet to make it to the auction. and of course, these are 99% of the time so mortgaged out, they have 5% to ZERO equity, sometimes even more money owed on them than they are worth.
Any ideas on HOW to find these would be appreciated.
See you all this weekend in Dallas,
Jim
